Insurance Bill Could Raise Employers' Overhead

Insurance Bill Could Raise Employers' Overhead

Article excerpt

City Wednesday said Congress will be asked to vote on a bill that
would add 20 percent to employers' overhead, but would not solve the
insurance problems of high-risk Americans.

Jane Ramshaw-Reed, a registered health underwriter from San
Diego, was in Oklahoma City Wednesday to conduct a seminar for the
Oklahoma City Association of Health Underwriters.

Ramshaw-Reed was critical of a bill authored by Sen. Edward
Kennedy, D-Mass., that has passed both House and Senate committees
on health care and is waiting to be brought before Congress in
January.

The bill would mandate health insurance for all workers,
regardless of whether they already are insured as a spouse or
dependent on another family member's insurance plan, she said.

Employers now pay workers compensation insurance to cover
on-the-job injury. The proposed legislation would also charge
employers with the responsibility to pay 80 percent of the premium
for health insurance for employees and their dependents, and 100
percent of the premium for full-time minimum wage employees.

Employers now pay 50 percent of the premium. The bill considers
anyone working 17 hours or more per week to be a full-time employee.

Kennedy has estimated payroll costs would increase 16 percent,
Ramshaw-Reed said. That estimate is low, she said, and the
insurance industry is estimating the payroll costs would increase by
between 25 percent and 28 percent.

Kennedy, Ramshaw-Reed said, has determined there are 37 million
uninsured Americans, or approximately 15 percent of the U.S.
population.

Ramshaw-Reed maintains that most of the uninsured choose not to
have insurance, since 50 percent of the 37 million are less than 30
years old and another 25 percent earn at least four times the
mimimum wage.

"Kennedy's solution is inappropriate simply because he hasn't
established a need," Ramshaw-Reed said.

The proposed legislation throws a curve ball, in the form of a
20 percent increase in overhead, at American small business owners,
Ramshaw-Reed said.

Their alternative to going out of business is to fire the
marginal people, the minorities and elderly, she said.

"Here he's trying to solve the problems for the uninsured and
he's going to put them out of work," Ramshaw-Reed said.

"It sounds very good to most people, but they're not going to
want to pay for it."

Kennedy has recognized that the federal government can not
afford the burden of insuring these uninsured people, but he has not
recognized that employers cannot afford the burden, she said. …